What is a Stakeholder?

What is a Stakeholder?

What is a stakeholder? A stakeholder is either an individual, group or organization who is impacted by the outcome of a project. They have an interest in the success of the project, and can be within or outside the organization that is sponsoring the project. Stakeholders can have a positive or negative influence on the project.

There are a lot of people involved in getting a project from inception to a successful completion. You’re going to have to know how to manage each and everyone one of them, even those who don’t work directly under you. One such person is the project stakeholder.

A stakeholder is a person, like any other member of the project, and some will be easier to manage than others. You’re going to have to learn to deal with a variety of personalities and make sure you’re having a productive dialogue with them to know the project goals you’ve been hired to meet. But first, who is the stakeholder?

Identifying the Right Project Stakeholder

Now that we basically know what a stakeholder is, the next thing you need to do is identify who they are in your project. First, who can be a stakeholder? That’s a long list. Some examples are as follows.

Project leader

Senior management

Project team members

Project customer

Resource managers

Line managers

Project user group

Product testers

Group impacted by the project as it progresses

Group impacted by the project after its completion

Subcontractors to the project

Consultants to the project

Identifying who the stakeholders are in your project is key. The project’s success depends on it. If your stakeholder isn’t happy, then the project is not a complete success. So, you want to start this process as soon as the project charter has been created.

A good place to start figuring out who your stakeholders are is by reviewing the project charter, which documents the reason for the project and appoints the project manager. Among the information about objects, budget, schedule, assumptions and constraints, project sponsor and top management, you can discern the stakeholders.

Also, review the contracts, as stakeholders might be mentioned in these documents. Are there environmental factors or other organizations with key ties to the project? Look those over too, as they might supply you with the names of stakeholders. For example, if there are environmental factors dictated by the government, then the government is a stakeholder. Review their regulations and standards to stay in good terms with them.

Managing the Stakeholder

A key question for anyone managing a project is how should you manage a stakeholder on the project? To complicate matters, there might be many stakeholders in your project. You should treat them like you would any other task on your to-do list: by prioritizing them. Over the course of a project, one stakeholder might be more valuable in terms of the project objections than another, whereas some stakeholders might demand more attention than others. So, you want to define who those people are and at what point in the project phase you might need to attend to them more, and build that into your schedule.

Now we’ve come to the second part of our question, which we’ve already started answering in the above paragraph. When we talk of stakeholder management what we mean is creating a positive relationship with your stakeholders by meeting their expectations and whatever objectives they agreed to in the project. This relationship isn’t just granted, however. It must be earned. You can earn the trust and build a positive relationship with stakeholders through proactive communication and by listening to their needs.

One way to do this is by interviewing the project stakeholders—not all of them, but certainly the most important ones. You might need to speak to experts to get the background you need for particular fields or groups, so when you do have one-on-one conversations with the stakeholders, you’re well-informed and ready to get the most out of that time together.

But know that stakeholders aren’t infallible. Like we noted earlier, their impact can be negative as well as positive. Stakeholders might have inaccurate or out-of-date information. That’s where your stakeholder management part comes into play. You want to vet any data stakeholders give you as true and accurate so that you don’t make key project decisions based on the agendas of others.

There is a process for this, like there is a process for everything in project management:

Document Stakeholder Communications. Do this formally in your project plan. Note their names and their roles in the organization they represent. Document every conversation you have with these key project partners, both to record their interests and requests, but also to be able to review their information later for accuracy. If you’re conducting interviews, ask the stakeholders if you can record those conversations, as any record of interaction is important to document.

Enforce Process. Next you want to keep to a process of communications with stakeholders, and make sure that process is transparent, so everyone knows what to expect. This includes project requests or feedback, and how you will document and respond to those requests needs to be subject to a formal process of review and approval. This lets the stakeholders know that requests are subject to review, and that you have a process that you adhere to for those formal requests. This protects both parties from scope changes and mis-communications that can impact the project.

Provide Frequent Status Reports. Providing regular and timely status reports that are appropriate for the stakeholders is crucial. You can go into details with team members, while executives are going to want more of an overview. So, tailor the reports to the audience. Don’t forget to follow up with stakeholders as well, asking questions to see if they have any feedback. That way you’re managing them, and you’re communicating with them proactively, to know if there’s discontent or some decision has been made that will impact the project.

Dispel Myths. Your stakeholder might be working on multiple projects, which means they’re not going to have the same closeness to the project as you. But that doesn’t mean they’re not getting other information about your project from other sources. You don’t want them to be subject to gossip or get incorrect information that might sway their opinions in the project. If they do make an assumption or get misinformation, you have to nip that poison in the bud and provide them with the truth. Sometimes they might not want to hear that truth, but better it comes from you, so you can control and manage it.

Executing the Project

Now you know what a stakeholder is, how to identify and manage them, but that is a process that must be carried through the entire life cycle of the project. You might have missed an important stakeholder in your initial research, and now you have a new person who is integral to the successful completion of the project. Worse, you can’t manage who you don’t know.

Therefore, it’s important to stay in constant contact with your stakeholders, as we suggested, and not only to know what they want. You can find out if there are new people who are in a position to influence the project. Get to know them, too. Things are always changing, and you have to manage that change or else you threaten the success of the project.

When you’re reporting to stakeholders you want to make sure the process is both streamlined and accurate. ProjectManager.com makes sharing reports easy as a click of a button. Our cloud-based project management software updates in real time, so you always have the most accurate, up-to-date project data for yourself and your stakeholders. See for yourself by taking this free 30-day trial.